My introduction to many businesses often comes about when their leaders are trying to decide whether or not to launch a transformation. However, the conversation is frequently less about their business sliding into oblivion, than the discomfort created by the transformation process itself. In fact, an extensive survey last year pointed to this with the remarkable statistic that while 62% of UK businesses recognised the need to change as few as 21% of these actually had a plan. Fear of the unknown makes businesses behave like rabbits in car headlights – and we all know how that ends up. It’s academic. You are going to have to change and the same three things are certain for everyone – transformation is expensive, time-consuming and painful. The trick is to minimise these things.
I find boards often aren’t ashamed to admit their reluctance to change. If there’s a stark choice between, on one hand, sitting comfortably, carrying on with business as normal and going bust, which will certainly be the case and on the other, a period of pain and a chance of a future, debate is only an admission of self-interest and that’s not what a board is there for. The trouble is, investors are often short-termist and so are senior executives. Both have one eye on the exit with investors looking at three-to-five years and, for instance, CEOs in the UK, according to PwC, tending to stick around only for 4.8 years. There’s no incentive for any of them to think beyond these time scales, especially if it has a negative impact on the numbers while they are in the hot seat, so execs wait until investors realise they are in trouble, which gives the management team an excuse to invest in change,. The trouble is, by then it’s usually far too late.
Some senior executives are prepared to brace themselves for change, but want to take it slowly to preserve profit. If you think that’s OK you, maybe, don’t understand the situation. If you aren’t by now well into your transformation you are already late and therefore very, very vulnerable. You can’t afford to move at anything but the fastest pace you are capable of and even then the statistics show you are probably not going to stay ahead of the tsunami of change that’s heading your way. Rather than preserving profit, very quickly you won’t have any revenue at all.
It’s an absolute certainty that digital businesses will take over your sector. You don’t get to choose when, unless you are the first mover. You won’t even see it coming, because most disrupters come out of nowhere, not the ranks of your existing competition. What’s more when they arrive their very nature means they can consume a market and that means all your customers, faster than you would believe possible. You should also bear in mind that it’s no use waiting until you see the whites of their eyes. You just won’t be able to move fast enough. Once you can see them it’s already too late. The only approach that guarantees a future is that of early, or better still, first mover.
When every day you delay or add to your transformation programme increases your risk, the only thing to do is to start now … and just hope it’s soon enough? So, what can you do to make all this as palatable as possible?
The fact is that something like seventy percent of transformations fail, and in many cases that spells the end of the business. As I said, time is running out and even if you could afford to go back and do it all again, you’ll probably be wiped out by digital competitors before you get to the chequered flag. The first objective therefore is to ensure you get it right first time.
Next you need to make the process far more efficient than transformations have tended to be to date. This is a matter of approaching the task logically.
Perhaps the most common mistake of transforming businesses is to approach transformation as an IT project. Sure, transformation is prompted by technology, but the tech is only the facilitator. To build that first usually means one of two outcomes – either you’ll have a very costly infrastructure that is partly redundant, which is a waste of time and money, or you’ll not have the functionality to affect the changes your business needs to compete.
The only sensible way to approach this is to start at the beginning, which is in identifying and focussing on your objective.
There are many reasons quoted for the failure of transformation projects, but they are usually secondary. In my experience they all stem from something far more fundamental – lack of focus and this is where brands play their part.
Your journey through transformation should start with a thorough study of your market, analysis and the creation of a strategy. Basically you will be identifying your opportunities and defining the resources that, combined with those you already have, you require to exploit those opportunities. This is about structure, practices, skills and product development and it’s a task for marketers. So too is the development of a brand model, which comes next.
A brand model is important because, if it’s tackled correctly, it will represent the unquestionable logic, which, once committed to record, will be the driver of everything you do moving forward. The neucleus of every brand model is the “brand promise”. This is the promise you make to every one of your stakeholders – the same promise to each of them – that defines how you will enhance their lives. The role of the organisation is to deliver that promise. It will first come into play in unifying your board, providing them with a clear target and gaining their commitment not only to hit it, but to do so as quickly as possible.
Of course, there are limitations to everything, not the least of which is finance, which will define the pace and extent of change, but any marketer worthy of the title will be able to work with the board to establish what’s possible.
Your brand model is also the nucleus of your internal marketing initiative. Don’t make the mistake of believing your board will bring about your transformation. They won’t and neither is it their job. Their role, as always, is facilitator. The people who will make your transformation happen will be your stakeholders – everyone at every level of your organisation, but before they can do so, they have to have a clear objective, understand the logic behind it and fully commit to playing their role in realising it. Getting them to this point is the “internal marketing” process. However, your internal marketing doesn’t have to reach out only to employees, it has to engage your entire brand community – that’s investors, partners, suppliers, distributers and customers, unifying them behind the single promise. Every one of them will, to some extent, contribute to making this a reality.
When everyone knows what they are doing and is enthused by the idea of belonging to your brand community your transformation will grow wings, things will happen faster, there’ll be fewer wasted resources, it will cost less and the execution will be far less painful. Everything, in fact, you need it to be.
However, there is an additional and crucial benefit of a strong brand and that is confidence. Yes, a brand gives you balls and those business leaders I meet who are currently freaking out at the prospect of transformation or want to slow the pace of change, having gone through a “brand-led business transformation”, will look back on their former selves with pride and wonder that they achieved so much both personally and professionally, so quickly.
The digital economy is no place for the meek. Success or indeed, the survival of today’s businesses definitely favours the bold, but if your approach is right, you’ll discover it’s not so scary after all. It’s all about preparation. Time and effort deployed in creating your brand and building your community will pay off many times and, if you are still teetering on the edge of transformation, it will certainly increase your chances of survival.
August 21, 2018